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Microsoft Offers Washington a Bargain: More State Taxes, For More Education
reifman writes: The Washington State Legislature and its budget is a complete mess this year but there's been an unusual bright spot which may quiet the protesters Slashdot reported earlier: Microsoft has volunteered for an exclusive $28 million annual tax — as long as the state funds a number of computer science degree programs. Visions of these faded after the 2008 recession when the legislature cut $4 billion from K-12 and higher education spending in part to cover the coming legalization and amnesty for Microsoft's Nevada tax dodge (students' tuitions only increased 58.6 percent.) With Microsoft's voluntary tax, the company will have fully repaid its $8.75 billion tax dodge by 2327, just 312 years from now.
Cisco for a long time inserted itself in schools by providing major discounts. They figured that if you train people to use and love Cisco, they will grow up buying Cisco. It's the common case of buy what you know. I did it, you did it and well all do it again.
Microsoft has cleverly figured out that it can spend $28 million to A) increase competition in the CS grad job market, thus driving down the cost of employees, and B) offload the costs they would incur training hires over to the state. How clever.
If the personal belief exemption for vaccines is outlawed. Otherwise I will throw a temper tantrum and use the equivalent of the taxes I should owe to hire lawyers to litigate until I turn blue in the face and the state gives up
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
I'd have said passive-aggressive. But if the shoe fits...
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
really.
...
So you can save more on salaries later. More OMGZ NO CODERS bs from MS who doesn't want to actually pay their workers well.
The thing I find the most annoying about budgets especially at the local level is that when money gets tight they'll always raise money for "schools" or "police" or something when really the cost over runs are because of something completely different.
And instead of cutting spending where it got out of control... they instead jack up taxes for "the children"... and then divert all that money to some other project.
I've even seen tax bills written such that that was specifically supposed to happen... and they looted the fund anyway in contravention of the law... and who is going to prosecute? Not the AG.
I think we might need a fourth branch of government that does nothing but hold the other three accountable.
Anyone ever read Herbert's the "Whipping Star" or its sequel? It has this concept in it... he called it "the Bureau of Sabotage"... they did nothing but fuck up the other branches so they couldn't pull any tricky slights of hand, fuck over the democratic system, break the law, etc... the bureau slowed the other branches down... so that they couldn't subvert due process.
Something like that at every level might fix a lot of our problems.
People would point out that that would be expensive... I would would ask... more expensive than rampant corruption and subverted law?
I've decided to stop wasting my time responding to AC trolls/sockpuppets... so if you want a response from me... login.
Would Microsoft really leave the state if the legislature decides to end the exemption/whatever that allows such a tax dodge?
As for this "voluntary tax", I sort of want to say, "No, unless it can be spent how the state pleases. Otherwise, donate it directly to the schools in question."
I think we might need a fourth branch of government that does nothing but hold the other three accountable.
We have that - it's called the press. Combined with an informed electorate it's pretty effective in the long run. It's not official in the government but you really don't want it to be. An official branch of government that isn't accountable itself is called a dictatorship. I'm pretty sure you wouldn't like that.
I despise Microsoft as much as anyone. But it's, at best, a strawman (non-)argument to call them a tax dodge or to claim they owe your hypothetical billions. Tax evasion and tax avoidance are two entirely different things. Learn the difference, and maybe you can sit at the adult table.
If you think the tax laws are broken, advocate for whatever changes you think are appropriate. But if you're going to attack someone else for not paying more tax than they are legally obligated to; then put your money where your mouth is, file a new W-4 with an extra $1000/cycle withholding yourself, and don't cash the refund check when it comes to you next year. I'll bet a dollar that says you won't though.
Imagine all the people...
> Whats with the ironic tone used in this "article"?
I'll give you the benefit of doubt. Maybe you're a 12-year old or something.
M$ pays taxes, provided they go for "Education", in reality computer classes. Which need computers with OSes and applications.
Last time M$ was convicted, it paid in software. Their software. With their prices.
You know, if someone thought this up, it would be prime material for a James Bond movie. Anyway, that's how it turned out. No point in calling paranoia something that already happened.
New M$ my ***.
But I'll admit that Nutella guy is cool. Not cool enough to turn the Titanic though...
But it's, at best, a strawman (non-)argument to call them a tax dodge or to claim they owe your hypothetical billions.
If they took extraordinary action to avoid paying taxes while still staying within the letter of the law then they ARE dodging taxes. Any argument otherwise is merely equivocation.
Tax evasion and tax avoidance are two entirely different things.
Just because something is legal doesn't make it right. And I don't buy your argument because it is basically a "might makes right" argument. Just because they have the ability to hire lots of lawyers and accountants to do clever tricks avoiding taxes does not mean it should be acceptable. Finding clever loopholes that force others to make up the slack in civil society is not something to be applauded.
But if you're going to attack someone else for not paying more tax than they are legally obligated to
I'm not. I'm attacking them for paying less than they are ethically obligated to. I don't care for a moment that they aren't technically breaking the law. The fact that the laws were imperfectly written does not excuse their behavior. I assure you that I am paying a FAR larger portion of my income in taxes than Microsoft is AND even if we paid the same percentage Microsoft would feel less financial pain from doing so. So until Microsoft starts paying an amount of tax that hurts them as much as what I pay hurts me your argument is bogus.
Not to downsay that, but the tax rate for tech company stock owners is very very very low here, we don't have a state income tax or a capital gains tax, and they tend to pay 1/3 what most workers pay.
Also, they are rescinding the mandatory K-12 classroom size reduction the voters passed, ignoring it so they can build more roads and tax exempt property access for tech companies.
That said, it's a good move at long last.
Pay attention to what they do, not what they say.
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Who wants to count the number of wrong assumptions, straw men and red herrings in this summary? Bonus points if you count them in TFA.
Hint: You won't be able to count them on your fingers. There's at least four in the first sentence alone.
You are welcome on my lawn.
What's the point of using a dollar sign in place of the S?
I imagine in the olden days you would also have complained when caravans took well-travelled and guarded roads rather than taking the back ways laden with bandits...
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Well, if they can't get the H-1B cap increased, then I guess growing their own talent locally, and flooding the market is the next best thing. The H-1B's would have been the optimum solution as that would have forced wages down more quickly.
Washington still has pretty onerous non-compete laws which Amazon and Microsoft pay their lobbyists to keep in place. Sorta sounds similar to H-1B indentured servitude...
No thanks. I'll stay in California.
that single people must pay
How so? If two single people make $50k each, they pay $8293.75 in taxes each for a total of $16587.50. If they are married, they pay $16587.50 jointly.
If you are not allowed to question your government then the government has answered your question.
Who wrote the tax rules. Hint: corporate lobbyists.
It's an awful nice economy you have there, it would be a shame if all these taxes made us layoff or move out of your state...
Little guys have no such clout, while the Intel's, Nike's, and Microsoft's can swing their weight around pretty readily. the result is that companies over a certain size effectively are able to become tax exempt for state and local purposes.
The argument is always that they employ enough people at high wages who pay plenty, which is a real cop out. Somehow I can't reconcile the behavior with the equal protection clause. Taxes need to be levied evenly and fairly, and letting important people and rich companies dodge these is really corrosive to society.
Timothy probably did not incorporate himself in a different jurisdiction, then pay his lower-taxed-self, a PO box in the desert, 90% of his salary for "services rendered." He likely DID pay more taxes than are required of him. The majority of people do.
There's the letter, and the spirit of the law. You can technically not break the letter while trampling all over the spirit. In some cases, there are even more gradations. OJ isn't criminally guilty of killing his ex, but he is responsible for it.
Could you put a little more socialist bias in your description of the events?
Why no complaints about the 50,000+ six-figure jobs Microsoft created in King County? Or about how Seattle and the Eastside have some of the best public schools on the planet, funded by property taxes, paid by homeowners who work for MS, Amazon, and Google among others? Or about how the technological innovation these companies, and others, provide, funded by the money they don't have to pay as taxes, has improved the abilities of humans around the world to access information and training?
I'm guessing that as a typical socialist, you're unable to understand the concept of opportunity cost (i.e. when taxes remove money from the private sector, the private sector has to cut R&D, expansion, or other expenditures). You probably think that a broken window is good for the economy, despite what Bastiat proved.
Because Microsoft is an evil corporation bent on profit! The horror!
The state of Washington should just seize all of Microsoft's assets to recover back taxes and penalties, just as it would to any individual or small business that ran-up such a huge bill via willful tax evasion.
You misunderstand, Microsoft does not owe any back taxes. The writer of the article is trying to make it look like they did, but they did not. What Microsoft is doing is like if you went to a "no sales tax day" sale and then later you volunteered to pay the sales tax for items you purchased on that day but only if it is used for programs of your choosing.
If you are not allowed to question your government then the government has answered your question.
So Microsoft is 100% responsible for legislation that benefited numerous other companies, not just Microsoft?
And that $4BN in education cuts, how many years did those cuts accumulate (10?) to reach $4BN, or was it $4BN/year?
Ken
Microsoft has been dodging WA State taxes at least since 1997 by redirecting ALL of its profits to a shell company in Nevada.
This petition here has a good analysis here showing running totals between $2.1 BILLION to $8.4 BILLION in dodged taxes.
Microsoft has effectively corrupted and captured the WA State's government, which routinely passes legislation to forgive Microsoft's back taxes, some as large as $100M a year, at times where the state is running deep into deficits.
Offering to "voluntarily" "contribute" 28M annually is like robbing a bank and then "offering" to return a few cents on the dollar.
Recalculate for the case where one person makes 75k and the other makes 25k and you'll see what the GP is referring to. I'm not saying it's wrong, just clarifying.
Whats with the ironic tone used in this "article"?
I'm not sure, but one thing I did notice was that the submitter for this article (reifman) is also the submitter for the previous article (the "Slashdot reported" link), and the other link is a link to his personal blog. The previous article links to an article that Jeff Reifman wrote at crosscut.com, and has a link that says "Nevada tax dodge" which points to an article at kplu.org that quotes Jeff Reifman.
I don't know what this means. I don't know if Microsoft is dodging Washington taxes via their office in Nevada, maybe they are, maybe they aren't. I do know that Jeff Reifman has a huge boner for Microsoft.
"Our two-party system is like a bowl of shit looking at itself in a mirror." - Lewis Black
Sorry for the self-reply.
I do know that Jeff Reifman has a huge boner for Microsoft.
I meant to say that he has a... huge micro soft boner?
Whatever. Carry on.
"Our two-party system is like a bowl of shit looking at itself in a mirror." - Lewis Black
If a U.S. company opens a store in France, when they sell an item in the French store at a profit, who collects the taxes on the sale - the US or France?
The Microsoft tax 'dodge' is the belief that taxes are owed in France, as long as the profits stay in France.
The populist argument is that Microsoft owes taxes in France AND the U.S. Because, well, because Microsoft is rich!
Some argue that only US taxes should be paid... Now, turn the example around, a French company opens a store in the U.S. And sells an item at a profit - does the French company owe US or France taxes on those profits?
Taxes are owed where the profits are made, and for an international company like MS that tends to be overseas.
Ken
The AC is trying to shrewdly point out that Microsoft is a for-profit corporation. And I'd like to thank him, too, because I always just assumed they were a charity or government organization. Nope, turns out they're a for-profit corporation. Thanks, AC!
"Our two-party system is like a bowl of shit looking at itself in a mirror." - Lewis Black
Problem with developers is that it is too little, too late. Even high school kids know that they can hold their nose, swallow, and make a decent living with a finance, accounting, or law job, even though their heart is in the STEM majors.
They are not dumb. They see people get into debt for a EE or CS degree, graduate, only to find that the only one wanting to hire them is the Army recruiter. Nothing bad about them, as they are better than nothing, but there are no companies interested in CS grads unless they have some experience under their belt, perhaps an internship or two. Then there is the college loan debt that ensures a life as a mendicant as the debt keeps capitalizing, year after year.
They also see that one can be in the industry for many years, and still have to compete for entry level wages against H-1Bs, or offshore houses which will work for the fraction of the cost. A master plumber does not have to compete against anyone and everyone who might be able to hold a wrench and wrap threads in Teflon tape, nor does an electrician have to compete for his living against someone off the street who is willing to twist some wires together.
Realistically CS is a dead end. It shouldn't be, because in every other country, technological advancement is a valued thing. However, here in the US, "just call Tata/Infosys" is a mantra that many companies use, either to do all dev work, or IT consulting. Just like manufacturing jobs which are offshore, there just isn't an employer demand for those fields.
Now, law, on the other hand, can't be offshored, and every company needs a lawyer, even to just write or go over documents before a transaction. Since there is no such thing as an unemployed lawyer, this is probably the best field for people to go to, assuming they can finance the education and law library.
I think he's talking about the fact that you can claim your spouse as a dependent.
That being said... if you earn enough, you run into the marriage penalty. That is, someone making a little over 400k by themselves will pay the same tax rate as two people making a little over 400k together rather than 800k as one would expect.
I think he's talking about the fact that you can claim your spouse as a dependent.
That being said... if you earn enough, you run into the marriage penalty. That is, someone making a little over 400k by themselves will pay the same tax rate as two people making a little over 400k together rather than 800k as one would expect.
Exactly my point. If anything, there is a marriage penalty and not a single penalty.
If you are not allowed to question your government then the government has answered your question.
"Mr Escobar has offered $100 meellion, if the State of Washington commits to no longer search lockers"
Exactly. We figured that my wife, who's doing a temporary job, is paying a 40% tax rate for under $15K. What's the point in working even part time if you get stuck with that kind of tax rate on *every* *single* *dollar*? And no, I don't consider us rich (nor poor) by any means--solid middle class.
I'd have said passive-aggressive. But if the shoe fits...
I can see you're not from here. We're all like that.
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Is it Microsoft's fault that the US tax system is so fucking broken? No, it's not. Microsoft isn't obligated to "repay" its tax savings. You're a shitty editor and you should feel shitty.
So they don't have lobbyists? ...
Are you sure?
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Bullshit. There's only the LETTER of the law.
If the law's flawed, that's NOT MS's fault (nor anyone's, really, except the scummy lawmakers that wrote it).
Again, the point is: blame the real people responsible for the shitty system, instead of re-electing them at a 97% rate.
-Styopa
I'm paying the taxes that Microsoft dodges thanks to their lobbyists, extortion by threatening to leave if they don't exactly what they want and their corruption in former Microsoft lawyers writing the laws that get signed off by legislators who have little to no recourse.
If I write a contract and then say "sign it or else" it's good old fashioned extortion. Meanwhile people such as myself then have to make up for the fact that one of the largest employers in the state isn't paying taxes like every other business. They've got enough clout that they legitimately threaten to destroy the state economy by leaving. When you're too big to fail or too big to lose the law no longer applies to you and it's just a formality to officially recognize whatever the corporation's current desires are. If I went to the state house and said "My company also doesn't want to pay taxes." they would say "too bad."
Then who should you blame?
Hint: the people you keep re-electing at 97%, not the people that are taking advantage of the system as-is.
As much as you may malign "big money corporate interests" do you simply not understand that's a canard engineered to keep you from really being mad at the right people?
-Styopa
Bullshit right back. The concept of spirit of the law has a long history, and is a valuable concept. Much of the interpretation of the US constitution relies heavily on the spirit, rather than the letter, of the law, and the English-derived precedent system owes much of its existence to the dichotomy.
Yes, things are simpler when those line up with each other. I don't think anyone would argue that US tax laws should be adjusted. Nevertheless, it IS rather cheeky of MS to "volunteer" to pay a special tax to support schools when they've dodged paying several orders of magnitude more than that. They have most certainly dodged paying those taxes - they've taken active, in some cases eyerollingly ridiculous, steps to avoid paying them, regardless of whether you feel those actions were justified or not.
This is a 'donation', not a tax. If it were a real tax, it would be written into law and/or tax code, and wouldn't be a one-time thing. The taxpayer does not get to decide how the specific taxes they pay are spent, and certainly a corporation doesn't.
They should have just donated the remains of Nokia to its employees.
MS is laying people off left and right. What do they need more CS grads for?
Could it be argued that if the state would fail if they left then they are, by reason, already paying their share? They are, as you say, keeping the state afloat. If they left your taxes would be much higher and your services lowered.
"So long and thanks for all the fish."
I see you're new here. Unlike you, I've managed to get many of my ideas put into practice in this state, when others said it couldn't be done. I've also managed to see that something was not going to happen and predict that with a high level of certainty, due to the nature of this state, on a regular basis.
You can waste your time. I'm not going to.
Rail against the dying of the light if you wish, and battle with the tides. I'll be collecting clams on the beach and having a clam bake instead.
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